SharePhil pushes reforms on shareholders’ rights

MANILA, Philippines - The Shareholders’ Association of the Philippines (SharePhil) is pushing for reforms that promote shareholders’ rights.

During the group’s annual general membership meeting yesterday, SharePhil president Francis Lim said the group has submitted proposed amendments to the Corporation Code to further safeguard the interest of minority shareholders.

Lim said independent directors must be elected by double majority — majority of the total number of shares entitled to vote in the election of directors (voting stock) and majority of the minority shareholders (those not among the top 20 stockholders owning voting stock).

He also stressed the fiduciary duty of directors to promote and develop a culture of corporate governance of a company.

Lim reported that the group’s membership base has been steadily increasing, which now stands at 83.

“We now have institutional members such as the Social Security System (SSS) and Cartica Capital, which is a foreign institutional investor,” Lim said.

Securities and Exchange Commission chairperson Teresita Herbosa, one of the guest speakers during yesterday’s meeting, underscored the need for equitable treatment of all shareholders.

Herbosa said the SEC itself is proposing amendments to the Corporation Code which would benefit minority shareholders.

For one, she said notices of annual stockholders’ meeting should be considered received on the day they were received. “This should be at least 21 days before the stockholders’ meeting,” Herbosa said.

She noted that a company’s stock price goes down because they do not adhere to corporate governance practices.

“A lot really depends on good corporate governance compliance principles,” she said.

She said some just comply with the minimum requirements.